As autonomous vehicles become more common in the future, vehicle insurance will likely have to shift from personal liability, Ajit Jain, Berkshire Hathaway, vice president of insurance said during the company’s annual meeting earlier this month. 

The Warren Buffett company owns GEICO, which Jain said is already working on a switch from providing insurance for operator error to an insurance that focuses on “errors and omissions” made during the manufacturing of the vehicle. 

“There’s no question that insurance for automobiles is going to change dramatically once self-driving cars become a reality,” Jain said in response to a question about autonomous vehicles and insurance during the meeting. 

He said currently how insurance is sold and bought revolves around operator errors, how often they happen and how severe they are and what premium the insurance company should charge because of that. 

Jain said autonomous vehicles also will likely be involved in fewer crashes, making insurance less required. 

However, Jain added that this shift will unlikely make vehicle insurance cheaper. 

“I think what we’ll see is a major shift where the number of accidents that take place and need to be provided for will drop dramatically because of automatic driving but on the other hand the cost per repair every time there’s an accident, the cost of repairing and bringing everything back to where it used to be, would go up very significantly because of the amount of technology that’s going into the car. How those two variables interact with each other, in terms, of the total cost of providing the insurance, I think is still an open issue.” 

Buffett said when he first walked into a GEICO office in 1950 the average price of a policy was about $40 a year. 

“You know it’s pretty easy to get up to $2,000 [today] depending on how urban your area is,” Buffett said. 

Technology has already changed the way insurance works, he said. He said fatal crashes are less likely due to technology but the cost to repair is higher. 

 Buffet said the world is always changing. 

“If the game didn’t change at all, it really wouldn’t be very interesting,” Buffett said. “If every time you swung a baseball and you hit a home run, the game wouldn’t be interesting.” 

Yet, Buffett said it’s remarkable how little insurance has changed over time. 

“Who knows what we’re doing to move transportation a 100-years from now,” Buffett said. “If you go back a couple hundred years, who would have predicted the United States would look like what it does and people would move like they do.”

In March 2025 Warren Buffett said in his annual letter to shareholders, “over the past two decades, our insurance business has generated $32 billion of after-tax profits from underwriting, about 3.3 cents per dollar of sales after income tax. Meanwhile, our float has grown from $46 billion to $171 billion. The float is likely to grow a bit over time and, with intelligent underwriting (and some luck), has a reasonable prospect of being costless.”

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Photo Youtube screenshot of Warren Buffett.